How Long Does it Take to Collect on a Life Insurance Policy?

An insurance company is not obligated to find the beneficiary of a life insurance policy. If the person can't be found, the money from the policy gets put into the deceased's estate.

When a loved one dies you must submit a number of documents to the life insurance company before they can start processing the life insurance claim. A death certificate is the primary document but you may also need a copy of the deceased’s social security number and even his or hers driver’s license. Your funeral director can expedite the process and help you obtain the death certificate and will provide you with several copies of the certificate you will need for various legal entities.

As a beneficiary of a life insurance policy you will also need to provide your name and identification. Some insurance companies also require beneficiaries to visit their office with identification.

In a straight forward claim, the beneficiary may receive a check within a few days but claims can be delayed for months depending on the circumstances of the death. There are a number of factors that will affect the amount of time that passes before a beneficiary can collect on the policy.

If the deceased has had a policy for three years or more, and there are no problems surrounding the cause of death, then the process should be completed quickly (some companies claim that checks can be issued within 48 hours but the average is about two weeks). Policies that are less than three years old will be investigated more closely. Insurance investigators will look for a failure of the deceased to disclose pre-existing health conditions or if the death was deemed to be by suicide. If the investigation uncovers evidence of these factors then the insurance company may contest the claim. In this case, even if everything is proven to be satisfactory after further investigation, it could take a few months until the policy is paid to the beneficiary.

The insurance companies can also contribute to delays as claims are paid out on their ability to process the information. It may be a good idea to do some research on life insurance companies by checking blogs and reading about other people’s experiences with a particular company.

In most cases, insurance companies are governed by the laws in their particular state or province that set guidelines for the times that claims should take to be settled. If you have questions about your claim, get in touch with your insurance agent first. If you are still not satisfied, contact your state or provincial insurance commissioner.